Paytm’s Q3 net profit jumps to ₹225 crore on UPI surge and merchant services boost

One97 Communications Ltd, the parent of Paytm, reported a net profit of ₹225 crore for the quarter ended December 31 (Q3 FY26), marking its third consecutive profitable quarter. The company had posted a net loss of ₹208 crore in the same period last year. 

The turnaround was driven by strong growth in payment transactions, merchant subscriptions — especially soundbox devices — and distribution of financial services, including personal and merchant loans. 

Operating revenue rose 20% year-on-year to ₹2,194 crore, supported by a 24% jump in Gross Merchandise Value (GMV) to ₹6.2 lakh crore. The company’s EBITDA improved to ₹156 crore with a margin of 7%, a year-on-year improvement of ₹379 crore. Indirect costs declined 8% to ₹1,092 crore, aided by lower employee expenses and provision for doubtful debts. 

Paytm’s payment services revenue grew 21% year-on-year to ₹1,284 crore, while net payment revenue rose 25% to ₹613 crore. Merchant subscriptions reached 1.44 crore, with 27 lakh devices added over the past year. 

Revenue from financial services distribution surged 34% year-on-year to ₹672 crore. Contribution profit grew 30% to ₹1,249 crore, with a contribution margin of 57%. 

Paytm also benefited from incentives under the RBI’s Payments Infrastructure Development Fund (PIDF), earning ₹216 crore for the nine months ended December. While the PIDF is set to expire by the end of 2025, the company expects its contribution margin to remain in the mid-50% range. 

The firm highlighted gains in consumer UPI share, with its UPI GMV growing 35% in the last nine months, more than double the industry growth of 16%. Backed by an AI-first strategy and product-led innovation, Paytm continues to strengthen its leadership across merchant categories and improve unit economics. 

The company closed the quarter with a cash balance of ₹12,882 crore. 

Shares of One 97 Communications Limited closed the day at Rs 1,171.80 (down 0.44 %) on January 29.